Issues of concern to people who live in the west: property rights, water rights, endangered species, livestock grazing, energy production, wilderness and western agriculture. Plus a few items on western history, western literature and the sport of rodeo... Frank DuBois served as the NM Secretary of Agriculture from 1988 to 2003. DuBois is a former legislative assistant to a U.S. Senator, a Deputy Assistant Secretary of Interior, and is the founder of the DuBois Rodeo Scholarship.

Saturday, April 14, 2018

A trade war by any other name

If it's a trade war you want, it's a trade war you'll get.
That's paraphrasing a response from China's embassy in Washington
last week in response to President Trump targeting over 1,300 Chinese
exports for tariff earlier this month. In traditional Chinese style, the
warning was issued in much friendlier language, a polite response – but
perhaps a strong warning.
"As the Chinese saying goes, it is only polite to reciprocate," the embassy noted after Trump's announcement.
Chinese officials in Beijing echoed those polite sentiments later,
saying they fully intend to take up the matter with the World Trade
Organization and will subsequently impose "corresponding measures of
equal scale and strength" again U.S. products traded to China.
Already China has confirmed they will enact tariff requirements on
several U.S. goods, specifically an increase in tariffs by up to 25
percent on 128 U.S. products, from frozen pork and wine to certain
fruits and nuts and more. Chinese officials say the tariffs will target
up to $3 billion in U.S. goods, but warns additional U.S. exports are
subject to be included depending on the U.S. response.
Some say the current trade dispute and subsequent trade war with
China will be little more than a tit-for-tat exchange, meaning
"equivalent retaliation from both sides." As President Trump imposes
tariffs on Chinese exports, the Chinese will respond with an equal
number of tariffs on U.S. goods, according to some analysts a push and
shove contest that in reality nets little or no gains for either side.
None-the-less, the threat of a U.S. trade war with China (which
officially would begin only after a May 15 public hearing in the U.S.
concerning the president's tariff recommendations against China). But
that hasn't stopped verbal rhetoric and barbs from trade officials on
both sides of the issue.
In the interim, U.S. producers, including the U.S. agriculture
industry and its many support groups, have expressed major concerns over
possible planned Chinese tariffs on U.S. agricultural products,
including pork and soybeans among others.
But earlier this week President Trump asked the U.S. Department of
Agriculture for options to assist farmers negatively impacted by the
recent trade developments, an apparent effort to boost the support of
U.S. farmers who are increasingly more concerned over a potential major
trade war, not only with China, but potentially with Mexico, Canada and
others...MORE

And late last year noted:

This is our #1 trading partner for ag products so the potential to cause harm to our farm and ranch families is great, and the reason the ag groups are expressing their concerns. In response, Trump is seeking ways to provide "additional support" to those negatively impacted. That has problems too, as the article continues:

But Bloomberg reported earlier this week that leading lawmakers on
congressional agriculture committees said they are skeptical that the
White fHouse can fix any economic harm for farmers arising from a trade
dispute with China by giving them temporary aid through USDA, a
sentiment also expressed by Republican Senator Pat Roberts of Kansas,
chairman of the Senate Agriculture Committee.
"We don’t need another subsidy program, we need to sell our product.
If we do that, we don’t need some sort of crazy-quilt program," Roberts
told reporters.
Skeptics also quickly responded that any special programs like
tapping the Depression-era’s Commodity Credit Corporation, established
in 1933 to help stabilize family farm incomes through a price-support
system, would only further increase the federal debt and could only be
sustained for a short period of time.
Farm groups are suggesting the best solution is to not start a trade war.

Agriculture is one of the few areas where we have a trade surplus and ag exports have a value of $140 billion. That accounts for 20 percent of total ag production. Or expressed another way, 1 out of every 5 acres harvested is exported. For beef 13 percent of total production in 2017 was exported with a value of $7.3 billion,Make no mistake, this is a big deal for agriculture and rural communities.